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Submitted by mtp0300 on November 2, 2005
Category: Business
Words: 3183 | Pages: 13
Views: 430
Popularity Rank: 18,725
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MGT 650
Term Paper
Risks Associated with Supply Chain Management
I. Introduction
Companies face a myriad of risks throughout their supply chain. To properly manage these risks, companies must be able to clearly identify them in order to accurately manage and mitigate their impact. Broadly defined, risks can be divided into two general categories: general risks, which are faced by most companies regardless
of the nature of the industry in which they operate or the nature of the goods or products they offer on the market, and industry-specific risks, which vary according to the industry in which a company operates. The following is a survey of the types of risks that can be classified within these two broad categories and some methods by which companies can help mitigate or avoid such risks. Lastly, an analysis of both types of risks will be applied to a real-world case scenario.
II. General Risks
The general risk category can further sub-divided into several sub-categories. There are operational risks, risks associated with balancing supply with demand, transportation risks, communication and information risks, supply chain integration risks, and external risks.
A. Operational Risks
One of the primary operational risks is the degree of contingency planning exposure. An essential part of operations management is the existence of contingency plans, well-developed strategies and initiatives that are in place to handle disruptions in the supply chain. Such plans must adequately identify the risks and have proper measures in place to mitigate and manage the impact of such risks. One excellent strategy that is often used is to maintain relationships with a plethora of alternate suppliers – suppliers...
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